Iran issues first progress report on nuclear deal

On April 17, 2016, Iran’s Foreign Ministry presented its first progress report on implementation of the Joint Comprehensive Plan of Action (JCPOA), the deal concluded last summer between Tehran and six world powers to scale back Iranian nuclear activities in exchange for sanctions relief (link in Persian). The Foreign Ministry plans to present such a report to parliament every quarter, with the ostensible goal of assessing headway on implementation. The first installment, though, while highlighting Tehran’s compliance with the JCPOA, also shows the government of President Hassan Rouhani, the moderate leader who championed negotiations, still trying to sell the deal at home.

Vocal doubters. Since the beginning of the Persian new year a month ago, several important voices within Iran have questioned the United States’ commitment to holding up its end of the bargain. They include Supreme Leader Ayatollah Khamenei, who had supported the negotiations while at the same time arguing that Washington could not be trusted. Throughout the talks, Khamenei claimed that the nuclear issue was a mere facade, and that America would ultimately find other “excuses” to keep existing sanctions in place or impose new ones. Today he argues that while the Islamic Republic has kept its side of the bargain, the United States is lagging. Leaders of Iran’s Revolutionary Guard Corp, the powerful paramilitary body with influence in political, economic, and military affairs, have echoed Khamenei’s thoughts and denounced perceived US untrustworthiness. Some commanders (link in Persian) have gone so far as to bash the JCPOA itself as dishonorable, despite having cautiously supported the process and negotiators in the past.

Against this backdrop of domestic pressure, it’s no surprise that the Foreign Ministry’s progress report tries to underplay Iranian concessions and highlight the deal’s benefits.

A positive spin. The report notes that most of the centrifuges Tehran has removed in order to comply with the deal—which allows only 5,060 machines to remain in operation at Natanz—were actually not used for uranium enrichment prior to implementation. This allows the Foreign Ministry to stand behind the accepted limitations on enrichment, by emphasizing that they do not impact Iran’s nuclear program. The report also observes that 1,044 centrifuges remain in operation at Fordow—which was converted from an enrichment facility into a research and development complex under the JCPOA—and are used to produce stable isotopes for research and medical purposes. Significantly, in its discussion of Fordow, the report doesn’t say anything about uranium enrichment or the fact that it is no longer occurring there. It merely states the good news: A number of centrifuges are in operation.

The report also explains the benefits of having shipped most of Iran’s low-enriched uranium stockpile out of the country. (Iran kept nearly 300 kilograms of a roughly 10,000 kg stockpile, and sent the rest to Russia.) It notes that in exchange for sending away its low-enriched uranium, Iran received yellowcake, a precursor for making nuclear reactor fuel, to meet “the country’s current needs.” The report underlines the significance of this event, as Iran has not been allowed to receive yellowcake from the international market since the 1979 Islamic Revolution, having been prohibited by a UN Security Council Resolution until the JCPOA.

The report also touches on a pillar of Iranian revolutionary ideology: Self-reliance. Iran argued during negotiations that it couldn’t convert the Arak Heavy Water Reactor into a light water reactor because it needed to be able to operate the facility by itself, and lacked light-water technology. JCPOA negotiators settled the issue by allowing Iran to keep Arak as a heavy water reactor, but requiring a redesign so that the reactor would produce less plutonium, thus minimizing proliferation concerns. This redesign was meant to take place with help from the P5+1 (the party that negotiated the JCPOA with Iran, composed of China, France, Germany, Russia, the United Kingdom, and the United States). But the Foreign Ministry’s new report suggests that Arak will be redesigned with or without help from the P5+1. Iran removed Arak’s calandria (or reactor core) in January, as agreed under the nuclear deal. Since then, Tehran has pursued several rounds of negotiations on the redesign. Earlier this year, the Atomic Energy Organization of Iran held talks with China and even entered a “basic agreement” to proceed with the redesign. More recently, Chinese state media reported (link in Chinese) that China and the United States will work with Iran to redesign the reactor.

The language used in the report, however, tells a different story: It says the main company Tehran is currently negotiating with to conduct the redesign is Iranian. This may indicate a lack of progress with China, or it may be a way to try to get a better deal with Beijing. Either way, it allows the Foreign Ministry to highlight Iran’s indigenous technical capabilities. The report also notes that US national labs have begun purchasing heavy water from Iran. This, the report underlines, marks a significant entry into the international market.

The report notes that the issue of whether Iran’s past nuclear program included possible military dimensions—or PMD—has been settled and closed. (Iran had to cooperate with the IAEA on an account of the relevant history in order for implementation of the nuclear deal to go forward.) The report highlights that the Foreign and Defense Ministries cooperated closely in order to reach the PMD settlement, thus emphasizing that national security concerns were taken into account. For instance, the report notes that Tehran did not have to provide any foreign bodies with access to its nuclear scientists and technicians in order to complete the PMD account.

The Foreign Ministry also boasts that in negotiating the nuclear deal, Iran was able to stick to one of its major national security non-negotiables, which was that its missile program should be excluded from talks.

In short, the Foreign Ministry’s new report tries to synthesize into a single document the arguments Iran’s negotiators and the wider Rouhani government have made in recent months. In doing so, it refers to Khamenei’s so-called “redlines” both explicitly and implicitly, reminding members of parliament that the Supreme Leader authorized the talks, and that negotiators operated within his limits. The Foreign Ministry is attempting to quiet critics who have recently pushed back against Tehran’s concessions.

No blame game. The Foreign Ministry also uses its first progress report to take a look at why Iranians are not yet feeling the economic benefits of sanctions relief.

It does not blame the United States. Rather, in a matter-of-fact way, it points out both international and domestic factors limiting the deal’s rewards. In this sense, the report is a departure from the usual Iranian rhetoric. It reflects a level of self-awareness and lays out the domestic challenges the Rouhani government wants to tackle in order to bring about economic recovery.

The report states that with the JCPOA’s cancellation of UN Security Council resolutions, the infrastructure upon which the sanctions regime against Iran was built has collapsed. This removes the limitations imposed on the Iranian banking, insurance, and transportation sectors, which had a devastating impact on the economy. The report also lays out the measures implemented by the United States executive and legislative branches, the European Union, and the international community to lift sanctions. It notes the progress made in the energy sector, with Iran now permitted to export oil and receive foreign investment, and touches on a key issue for the Iranian people: The ability to purchase new aircraft and aircraft parts, to revitalize an aging and unsafe fleet. Finally, it notes that Tehran can now purchase nuclear and dual-use items on the foreign market—with international oversight—which it was previously prohibited from doing.

Recognizing challenges. While highlighting the benefits of the deal, the report also lays out challenges ahead for JCPOA implementation, enumerating them as follows:

1. Only nuclear-related sanctions have been removed, while those relating to Iran’s human rights record, support for terrorist groups, and other military activities remain in place. The report notes that while this comes as no surprise, it makes it more challenging for Tehran to experience speedy and effective sanctions relief.

2. The process will be slow. The Foreign Ministry clearly feels the pressure from various domestic factions to deliver on sanctions relief, and wants to remind Iranians that results will take time.

3. The psychological impact of sanctions remains in place. Here, the report notes that the negotiators never doubted they were concluding a deal in an atmosphere of severe distrust. In saying so, the Foreign Ministry places itself in the same camp as Khamenei and the Revolutionary Guard Corp, who likewise didn’t trust the United States. The US Treasury Department is singled out as failing to meet its obligations under the deal. The report discusses “powerful” players in the United States who not only don’t seek to implement the JCPOA, but in fact try to neutralize it and stop its progress.

4. The domestic environment isn’t conducive to building trust with foreign investors and inviting them in. The report identifies this as the greatest obstacle before Iran. This is important, as it tells us the Rouhani government clearly places this matter at the forefront of future efforts.

The Foreign Ministry’s first progress report to parliament comes at a time when the JCPOA and its implementation are increasingly controversial in Iran. Citizens, who seem fatigued by the subject, have adopted an approach of going about daily life and passively waiting to see what happens next. The political and security establishment doesn’t have the same cohesion on the deal as it did a few months ago. Today, Khamenei, the Revolutionary Guards, and others increasingly criticize the JCPOA, saying the United States is untrustworthy and attempting to sabotage Iran by all means. The belligerent rhetoric used by most US presidential candidates vis-à-vis both Tehran and the JCPOA doesn’t help alleviate these concerns. But amid these tensions, the Foreign Ministry’s measured report is incredibly important in signaling a great deal of self-awareness within the Rouhani government. Far from just shifting the blame to Washington, and trying to place the burden on its shoulders, the Foreign Ministry identifies the challenges before the JCPOA with more objectivity than what we’ve come to expect from the Islamic Republic. The report does enumerate obstacles before Iran stemming from beyond its borders, and from US actions, but notes that the greatest challenges are in fact domestic.

While the Rouhani government has indicated it wants to address the challenges in the report, it remains to be seen how successful it will be in doing so, especially given the level of resistance from conservatives. In the meantime, the United States needs to adopt a consistent policy that supports—rather than undermines—the terms of the multilateral agreement it reached with its partners and Tehran. If the United States wants to lead on future arms control and nonproliferation agreements, making sure the JCPOA is implemented effectively is critical.